In the challenging macroeconomic environment, distractions are everywhere. While we are aware of the prevailing market conditions, our focus remains on identifying and investing in a select universe of companies that meet our four investment pillars:
Are earnings estimates too high? It’s a question being repeatedly asked, as the market speculates about the economic outlook. But perhaps the first question should be: are historic earnings too high?
It isn’t uncommon for management teams to systemically overstate their company’s profitability and skew the starting point for evaluating a company’s outlook. In recent years, short-term narratives have often trumped financial reality.
